603.05 Child/Dependent Care Deduction (FSM)

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Deduct the actual verified unreimbursed cost of care for a dependent child or incapacitated parent from the individual’s adjusted gross income. The individual’s child care costs must be employment-related including participating in training, job search or education which occurs for the purpose of obtaining employment.

*Unreimbursed costs are total costs minus any reimbursements made by non-assistance group members.

Exception: Do not allow the child/dependent care deduction for individuals whose employment-related expenses have been suspended.

*For incapacitated adults, if the cost can be considered a medical deduction and a dependent care deduction, use the cost as a medical deduction.

Exception: When the expense is billed to an excluded member:

• if the member is excluded due to failure to comply with work registration requirements or for fraud, allow the entire amount;

• if the member is excluded due to ineligible alien status or for failure to comply with the SSN requirements, prorate the child care cost using the following method:

- total the child care cost;

- divide the total cost by the number of assistance group members plus the number of excluded members;

- multiply the result (the per person share) by the number of members excluded due to ineligible alien status or failure to comply with SSN requirements; and

- subtract the result (the amount prorated to excluded members) from total child care costs. The result is the allowable deduction.